Final answer:
Government intervention is appropriate from an economic point of view when the market is not in equilibrium, such as in the case of monopoly or negative externalities. However, it is important to consider the strengths and weaknesses of both markets and government before determining the level of intervention.
Step-by-step explanation:
From an economic point of view, government intervention is generally considered appropriate when the market is not in equilibrium. This is because markets can sometimes fail to achieve efficiency on their own, resulting in market failures such as monopolies and negative externalities.
In the case of monopoly, a single firm has control over the market, leading to higher prices and reduced competition. Government intervention, such as antitrust regulations, can help promote competition and protect consumer interests.
Negative externalities occur when the actions of one individual or firm impose costs on others without compensation. For example, pollution from factories can harm the environment and public health. Government intervention, through regulations and taxes, can help internalize these external costs and achieve a more efficient outcome.
However, it is worth noting that government intervention is not always the best solution. In some cases, the market can correct itself through competition and innovation. It is essential to carefully assess the specific circumstances and consider the strengths and weaknesses of both markets and government before deciding on the appropriate level of intervention.